Dozens of Online ‘Dark Markets’ Seized Pursuant to Forfeiture Complaint Filed in Manhattan Federal Court in Conjunction with the Arrest of the Operator of Silk Road 2.0

Dozens of Online ‘Dark Markets’ Seized Pursuant to Forfeiture Complaint Filed in Manhattan Federal Court in Conjunction with the Arrest of the Operator of Silk Road 2.0

Preet Bharara, the United States Attorney for the Southern District of New York, Leslie R. Caldwell, Assistant Attorney General of the Justice Department’s Criminal Division, George Venizelos, the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), and Peter Edge, Executive Associate Director of Homeland Security Investigations (“HSI”), announced today the seizure of the Silk Road 2.0 website as well as dozens of additional “dark market” websites offering a range of illegal goods and services for sale on the “Tor” network, a special network of computers on the Internet designed to conceal the true IP addresses of the computers on the network. The website addresses and computer servers hosting these websites were seized yesterday as part of a coordinated international law enforcement action involving the U.S. Attorney’s Office for the Southern District of New York, the Department of Justice’s Computer Crime and Intellectual Property Section, and the law enforcement agencies of approximately 16 foreign nations working under the umbrella of Europol’s European Cybercrime Centre (EC3) and Eurojust. This action follows the arrest announced Thursday of BLAKE BENTHALL, a/k/a “Defcon,” for his alleged role in operating the Silk Road 2.0 website. It constitutes the largest law enforcement action to date against criminal websites operating on the “Tor” network.

Manhattan U.S. Attorney Preet Bharara said: “As illegal activity online becomes more prevalent, criminals can no longer expect that they can hide in the shadows of the ‘dark web.’ We shut down the original Silk Road website and now we have shut down its replacement, as well as multiple other ‘dark market’ sites allegedly offering all manner of illicit goods and services, from firearms to computer hacking. In coordination with domestic and international law enforcement agencies, we will continue to seize websites that promote illegal and harmful activities, and prosecute those who create and operate them.”

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division said: “It is a plain fact that criminals use advanced technology to commit their crimes and conceal evidence—and they hide behind international borders so they can stymie law enforcement. But the global law enforcement community has innovated and collaborated to disrupt these ‘dark market’ websites, no matter how sophisticated or far-flung they have become.”

FBI Assistant Director-in-Charge George Venizelos said: “In today’s world we do everything online, from banking to grocery shopping. In much the same way, criminals have taken their illicit business to the ‘Tor’ network. However, websites that offer everything from drugs to illegal services on these black-market sites are not out of reach of law enforcement, as today’s announcement shows. We will continue to work with law enforcement at home and abroad to investigate, disrupt, and dismantle illicit networks that pose a threat in cyberspace.”

HSI Executive Associate Director Peter Edge said: “Underground websites such as Silk Road and Silk Road 2 are like the Wild West of the Internet, where criminals can anonymously buy and sell all things illegal. We will continue to use all of our resources and work closely with our U.S. and international law enforcement partners to shut down these hidden black market sites, and hold criminals accountable who use anonymous Internet software to peddle their illegal activities.”

According to the forfeiture complaint and other public documents:

The sites targeted in the seizure operation include the Silk Road 2.0 website and dozens of other “dark market” websites operating on what is known as “The Onion Router” or “Tor” network, a part of the Internet designed to make it practically impossible to physically locate the computers hosting or accessing websites on the network (the “Dark Market Sites”). These sites were all operating online criminal marketplaces, openly advertising on their home pages and offering to sell a variety of illicit goods and services to customers in the United States and elsewhere. The advertised goods and services included, among other things: illegal narcotics; firearms; stolen credit card data and personal identification information; counterfeit currency; fake passports and other identification documents; and computer-hacking tools and services.

The Dark Market Sites were designed to facilitate the illicit commerce hosted on the sites by providing anonymity to their users, in at least two ways. First, the Dark Market Sites were only accessible to users of the Tor anonymizing network. Second, the Dark Market Sites accepted payments for their illicit goods and services in “Bitcoin” or similar electronic currency designed to be as anonymous as cash.

The operation against the Dark Market Sites involved the seizure of over 400 Tor website addresses—known as “.onion” addresses—as well as the servers hosting them. Examples of some of the sites seized in the operation include:

• “Executive Outcomes” (http://iczyaan7hzkyjown.onion), which specialized in firearms trafficking, with offerings including assault rifles, automatic weapons, and sound suppressors. The site stated that it used “secure drop ship locations” throughout the world so that “anonymity [was] ensured” throughout the shipping process, and that all serial numbers from the weapons it sold were “remove[d] . . . and refill[ed] with metal.”

• “Fake Real Plastic” (http://igvmwp3544wpnd6u.onion), which offered to sell counterfeit credit cards, encoded with “stolen credit card data” and “printed to look just like real VISA and Mastercards.” The cards were “[g]uaranteed to have at least $2500 left on [the] credit card limit” and could be embossed with “any name you want on the card.”

• “Fake ID” (http://23swqgocas65z7xz.onion), which offered fake passports from a number of countries, advertised as “high quality” and having “all security features” of genuine documents.

• “Fast Cash!” (http://5oulvdsnka55buw6.onion) and “Super Notes Counter” (http://67yjqewxrd2ewbtp.onion), which offered to sell counterfeit Euros and U.S. dollars in exchange for Bitcoin.

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Mr. Bharara praised the outstanding joint efforts of the FBI and its New York Special Operations and Cyber Branch and HSI and its Cyber Crimes Center and Chicago-O’Hare Field Office. He also thanked the Drug Enforcement Administration’s New York Organized Crime Drug Enforcement Strike Force, which comprises agents and officers of the DEA, the Internal Revenue Service, the New York City Police Department, HSI, the New York State Police, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the U.S. Secret Service, the U.S. Marshals Service, Office of Foreign Assets Control, and New York Department of Taxation. Mr. Bharara also thanked the Department of Justice’s Computer Crime and Intellectual Property Section for its partnership in the operation, the Office of International Affairs, and the law enforcement authorities of Bulgaria, the Czech Republic, Finland, France, Germany, Hungary, Ireland, Latvia, Lithuania, Luxembourg, the Netherlands, Romania, Spain, Sweden, Switzerland, and the United Kingdom, whose actions have been coordinated through Eurojust and Europol’s EC3. Mr. Bharara also noted that the investigation remains ongoing.

The prosecution of this case is being handled by the Office’s Complex Frauds and Cybercrime Unit and Money Laundering and Asset Forfeiture Unit. Assistant United States Attorneys Serrin Turner, Timothy Howard, and Daniel Noble are in charge of the prosecution. Assistant United States Attorney Margaret Graham is in charge of the forfeiture aspect of the case.